Frequently Asked Questions

Q. Why Do you Need a Franchise or Dealer Lawyer?

A. Although franchises and dealerships are universal throughout our country, franchise and dealership law is surprisingly difficult and obscure.

Michael Garner is fond of telling the story that he won one of his first cases because the other side’s lawyer – a well-respected general practitioner -- did not know about the franchise law in his own state and failed to take action that could have changed the result!

Franchise law is taught in only a handful of law schools, and the special laws that protect franchisees and dealers are different from state to state. California’s franchise law is completely different from New Jersey’s. Some states protect all types of franchisees, while others protect only farm equipment dealers or beer distributors or office equipment dealers. Franchise lawyers need a specialized law library at their fingertips to do their job right! Michael Garner’s books are usually in those libraries.

But knowing the specialized laws is not enough – a good franchise attorney needs to also have thorough training and knowledge of all the other special laws that affect franchises and dealerships:  the law of contracts; antitrust and trade regulation; fraud; trademarks; bankruptcy; and other fields.

Q. If I contact you, what can I expect? 

A. First, you can expect a prompt response and assessment of your legal situation.  In most cases, we will provide a free preliminary consultation, in which we will assess your rights and liabilities and give you a preliminary view of what can be done, how we will do it and the approximate range of what it will cost.

Q. What if I need help right away?

A. In most cases, if you need help right away, we will immediately turn to your situation and give you help.

Q. Who will work on my case?

A. Michael Garner will be directly responsible for your case.  In some cases he will be assisted by other lawyers working under his direct supervision.

Q. Where can Michael Garner practice law?

A. Michael is a member of the bars of Minnesota and New York.  In other states, temporary admission is usually available for purposes of a particular case.

Q. What will it cost?

A. Every case is different, so we can’t generalize about costs.  But we can say that every client deserves a fair budget, and no surprises when the bill comes.

Frequently Asked Questions About Termination and Non-Renewal:

Q. Who are some of the franchisors that Michael Garner has stopped from terminating or non-renewing franchises?

A. A sampling includes KFC, Wendy’s, Terex, Lund Boats, John Deere, GCO Carpets, Ford Motor Co., Hardee’s, Sona Laser Centers and Bruegger’s Bagels.

Q. What should I do if I’ve gotten a notice of default or a termination letter?

A. Act fast! Your rights depend on many, many different factors – your contract, where your business is located, and the circumstances of your particular situation.   The sooner you get good legal advice, the sooner you can take action to stop a termination or non-renewal.

Q. My franchise agreement ends soon and the franchisor tells me they are not going to renew it.  What can I do?

A. Under the law in some states a non-renewal can be the same as a termination.  Depending upon where you are and the circumstances of your situation, you may be entitled to continue with your franchise or dealership.

Q. My franchisor is making life rough on me – increased inspections, nitpicking my performance, making me toe the line on contract matters.  Does this mean they are getting ready to terminate me?

A. Depending on the circumstances, it could.  You need to have an experienced franchise lawyer review the circumstances carefully to determine your rights.

Q. I got a notice of termination, and the date for termination has already passed.  What are my rights?

A. You may be entitled to damages if the termination was wrongful.

Q. My franchisor just got acquired by a Wall Street investment banking firm.  They say that they are not going to be franchising any longer and will not be renewing my agreement because it doesn’t fit their business model.  Can they do that?

A. In most cases, a franchisor needs to have “good cause” to terminate or refuse to renew a franchise.  Good cause usually means that you, the franchisee, are at fault.   The franchisor’s decision to change its business model is usually not “good cause.”

Frequently Asked Questions About Franchise Fraud and Misrepresentation:

Q. What kinds of damages has Michael Garner gotten for franchisees who have been defrauded?

A. The awards he has obtained have generally ranged between half a million dollars to three million dollars. 

Q. Who can I sue for fraud?

A. Usually, you can sue the company that made the misrepresentation as well as any individuals who actually made, or participated in making, the misrepresentation.  Under some state laws, you can sue the owners, officers or executives who defrauded you.

Q. Can I start a criminal case for fraud?

A. Criminal cases are usually handled by the local state or federal prosecutor’s office in conjunction with other state or federal agencies. You may want to file a complaint with that office, a consumer affairs office in your city or state, with the Federal Trade Commission or with a state franchise office, if your state has one. A criminal prosecution may result in penalties for the wrongdoers, but does not have as its objective the recovery of your losses. Our objective is to assist you to recover those losses.

Q. What are the most typical kinds of fraud that franchisors engage in?

A. The most frequent types of misrepresentations are those relating to the money franchisees can make, the uniqueness or proprietary nature of the franchise being offered, the performance of the system, and the adequacy of the franchisee’s location.

Q. Here’s my problem:  The franchisor didn’t actually say anything false.  They just didn’t tell me the full story.  If I had known everything, I wouldn’t have bought the franchise.

A. Fraud comes in many forms, including fraudulent omission – the knowing failure to tell you something that you should have been told. Not all omissions rise to this level. If you think you weren’t told something that you should have been told, contact us for an evaluation. 

Q. Okay. I think my franchisor lied to me. How do you prove that?

A. If it’s not obvious, usually a lie will fall apart over time; the evidence of the truth will come out; there will be people (ex-employees, other franchisees) who will know the truth and will tell it; or documents in the franchisor’s files, which can be obtained through discovery, will show the truth.

Frequently Asked Questions About Franchise Encroachment:

Q. My franchisor has just started selling over the Internet in competition with me.  What can I do?

A. Internet encroachment is one of the more common forms of encroachment today.  Michael Garner pioneered the field of protecting franchisee rights on the Internet.  Depending on what your franchise agreement and the law say, you may be able to stop the franchisor from selling in your area or you may be able to share in the profits of its sale.

Q. My franchise agreement says I only have the right to a “location.”  Does that mean I don’t have protection against encroachment?

A. A number of cases have been decided that protected franchisees’ rights to their markets even though their agreements specified that they were only entitled to a “location.”  Your rights will depend upon what the entire contract says, upon your state’s law and upon the particular circumstances of your situation.

Q. Can my franchisor sell the same products under a different name in my territory?

A. It depends, in part, upon what your agreement says.  If your franchisor is selling into your territory so that it hurts you, it is likely that you have a claim against it.

Q. I have a “Territory” in my agreement, but I sell to, and advertise in, a much bigger area. What kind of protection do I have?

A. A number of cases have recognized that franchisees have rights that go beyond what the contract says.   Particularly if the franchisor has told you, in the past, that it would not sell in this larger area, or if the franchisor’s sales are hurting you badly, you may be entitled to relief.

Q. My franchisor is encroaching on my territory but not on the territory of other franchisees.  Does that violate the law?

A. A number of states have laws against discrimination between franchisees and courts have, on other grounds, found violations of law where franchisors have treated some franchisees different from others.